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Telecom Policy: Roaming charges to go, broadband speed up

Communications minister Kapil Sibal on Monday unveiled the draft National Telecoms Policy 2011, containing new rules for the sector.

The revised rules, which will replace the existing framework that has been in place since 1999, aims to have broadband on demand for all citizens.

The new policy states that revenue generation will play a secondary role and the main objective was to increase rurual teledensity to 100% by 2020.

Sibal said that special focus will be on rural and remote areas and the new policy would have a framework to make more spectrum available.

Sibal had already announced that new policy will de-link licences from spectrum and had added that the tenure of mobile permits would be halved to 10 years when they come up for renewal. Kapil Sibal said that the policy aims to make 300 MHz of spectrum available by 2017 and and another 200 MHz by 2020.

The draft plan also proposes to do away with roaming charges, introduce a stronger customer grievance redressal mechanism, recognize telecoms as an infrastructure sector giving it tax concessions, and extend preferential status to 'Made in India' hardware products.

Roaming charges account for 8% of cellular operators revenue. According to KPMG, doing away with roaming charges will effect the telecom companies negatively.

The policy will focus on convergence of TV, internet and internet services. Broadband download speed will be revised to 512 kbps vs 216 kbps.

Sibal said that

the government will audit the use of spectrum. He also added that the policy aims to make India a hub for telecom equipment manufacturing and will have provisions to create a corpus for R&D, IPR and entrepreneurship.

The telecom minister said that India's teledensity currently was at 74% and there are 866 million mobile phones in India. Rural teledensity was at 35.6%.